A promise

							IN THE LABOUR COURT OF SOUTH AFRICA

HELD AT CAPE TOWN

                                                           Case      no:

C168/2007



In the matter between:

FREDERIC JOHAN DU PLESSIS                          Applicant


and
 KAAP AGRI BEDRYF LTD                                 Respondent

                              JUDGMENT

MOLAHLEHI J

Introduction

[1] This is an application in terms of which the applicant sought to

   challenge the termination of his employment on the basis that it was

   an unfair dismissal based on operational reasons by the respondent.

   The respondent contended that the employment relationship was

   terminated by mutual agreement between the parties.



[2] The applicant abandoned issue of procedural fairness at the beginning

   of the hearing.

[3] The issues to be determined in terms of the agreement between the

   parties are whether:


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                  “5.1 The settlement agreement entered into between

                 the   parties   deprived    the   Honourable   Court    of

                 jurisdiction to entertain the dispute;

5.2 The settlement agreement entered between the parties :
5.2.1 Was induced by misrepresentation; or
                 5.2.2 constitutes the valid settlement of an unfair

                 dismissal dispute;

[4] If it was to be found that the agreement was induced by a

   misrepresentation and that the Court had jurisdiction to entertain the

   dispute, then the remaining issue would be whether or not the

   dismissal was substantive fair.



Background facts

[5] It is common cause that the respondent experienced difficult trading

   conditions during the first months of its financial year 2005/2006.



[6] The applicant who was employed as General Manager: Packaging was

   concerned about the performance of his division and as a result

   motivated for the reduction of staff as a cost saving measure. At that

   stage there were three managers reporting to the applicant and he

   reported to the Operations Manager.




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[7] As a result of these trading difficulties that respondent embarked on

   cost cutting measures during January 2006 and when this did not yield

   any positive results, a meeting was convened with all staff members

   on 20 February 2006. At this meeting the respondent informed the

   staff that it intended to commence with consultation regarding the

   proposed restructuring and that would done in terms of s189(3) of

   Labour Relations Act 66 of 1995 ( the Act).



[8] Thereafter, and on the 22 February 2006, Mr Liebenberg, the General

   Manager and Mr J du Toit, the Senior Manager, met with the applicant

   and advised him that his position would be made redundant. The

   applicant did not contest the issue of making his position redundant.

   What then followed after this announcement was consultation between

   the parties regarding the severance pay for the applicant.



[9] The consultation resulted in an agreement between the parties on

   amount of severance to be paid to the applicant. Although the

   applicant left the employment of the respondent on 28 February 2006,

   the employment terminated on        31 March 2006.



[10] It is common cause that the applicant appointed Mr Andre Du Toit

   was appointed to the position of General Manager: Packaging


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   Material, a fact the applicant claims he became aware of on 13

   November 2006. The applicant further testified that this is the same

   position he occupied before termination of his employment with the

   respondent. It was also arising from this that the applicant referred a

   dispute to the Commission for Conciliation, Mediation and Arbitration

   (the CCMA).



[11] The conciliation process having failed to settle the dispute and

   Commissioner Warwick having ruled that the CCMA did not have

   jurisdiction to hear the dispute, the applicant instituted these

   proceedings.



The case of the applicant

[12] The thrust of the applicant’s case is that he signed the agreement

   terminating his employment due to the misrepresentation by the

   respondent. The misrepresentation according to him arose from the

   presentation by the respondent during the consultation that his

   previous position, that of the General Manager: Packaging would be

   done away with.



[13] He conceded during cross examination that he had made the

   proposal for rationalisation which would result in the reduction of


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  staff complement as a cost saving measure. He further conceded that

  despite the fact that the rationalisation process was to render certain

  positions redundant, it was not intended to do away with the functions

  of those positions. The functions were according to him to be

  absorbed into other positions which were unaffected.



[14] When asked whether he would have accepted the position regard

  being had to the fact that it paid R10 000.00 less than what he earned

  at the time the applicant indicated that he would seriously consider it.



The case of the respondent

[15] The respondent closed its case without leading any evidence and

  applied for the dismissal of the applicant’s case with costs. The

  respondent contended that the case should be dismissed because the

  applicant had failed to prove that he was dismissed. The applicant

  contended that in the alternative, the case should be dismissed because

  the matter was res judicata, the dispute having been settled by

  agreement.



Evaluation
[16] It is clear that the applicant sought to have the agreement

  concluded between him and the respondent set aside on the basis of


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   misrepresentation.



[17] The legal principles to apply when dealing with a plea of

   misrepresentation are summarised in Novick And Another v Comair

   Holdings and Others 1979 (2) SA 116 (WLD) as follows:

            “(a) That the representation relied upon was made.

(b) That it was a representation as to a fact. A promise, prediction,
      opinion or estimate or exercise of discretion is not a representation
      as to the truth or accuracy of its content; it can, however, often be
      construed as a representation that the person making it is of a
      particular state of mind.
(c) The representation was false. In relation to an ordinary
      representation of fact, what must be shown is not merely that it
      was, or turned out to be, erroneous, but that it did not represent the
      bona fide view, at the time when it was expressed, of the person
      who expressed it.
(d) That bit was material, in the sense that it was such as    would have
      influenced a reasonable man to enter into the contract in issue.
            (e) That it was intended to induce the person to whom it was

            made to enter into the transaction sought to be avoided.”



[18] In the pleadings and his evidence the applicant does not reveal the

   nature or form of the representation made by the respondent. His

   contention is that the redundancy of his position was not properly

   thought through. In his testimony the furthest he could go in relation


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   to this issue was that had the position mad available he would have

   considered it.



[19]   Unlike in the case of Baudach v United Tobacco (200) 21 ILJ

   2241 (SCA), where the misrepresentation was found to be the cause

   of the inducement for the employee to accept the settlement, in the

   present instance there is no basis to arrived at that conclusion. Both

   the pleadings and the evidence of the applicant do not reveal how the

   applicant was misled into entering into the agreement. Mr Grobler

   counsel for the applicant argued that the applicant would not have

   signed the agreement but for the fact that he was told that if did not

   sign at that stage he ran the risk of not receiving the same amount of

   severance pay should the respondent not succeed in making savings in

   that period. that, if there was no improvement in the performance of

   the respondent he could receive a lesser severance pay. It was not

   stated as a fact that if he did not sign at that stage he would receive a

   lesser severance pay. There existed a possibility that he and other

   affected employees would receive what they ultimately received even

   if they did not sign at that stage depending on the improvement in the

   financial performance of the respondent.



[20] It is also important to note in relation to the issue of representation


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   that the applicant testified, when asked whether he would have

   accepted the position despite the fact it was paying R10 000.00 less

   then what he earned before termination of his employment, that he

   might have considered the position. He did not say that he would have

   accepted the position.



[21] Mr Grobeler further argued that the applicant would not have

   signed the agreement but for the presentation that his post was

   redundant. This argument does not assist the case of the applicant

   because on his own version the proposal came from him that there was

   a need for the respondent to embark on a cost saving exercise. It is

   undisputed that this exercise resulted in significant savings for the

   respondent.



[22]   It is also not dispute that the person who the          respondent

   appointed was not an outsider but an employee who was transferred

   horizontally and earned a salary far less than that of the applicant.

   Whilst the title of the post occupied by the person who was transferred

   from Trade Devision, was the same as that which was occupied by the

   applicant, General Manager: Packaging, the content of the post is

   different. This transfer which is recorded as part of the common cause

   facts in the pre-trial minute occurred as a result of a further


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  restructuring which occurred in 2007. It is however strange as the

  applicant contended, that the appointment was made retrospective to

  October 2006. However, this does not assist the case of the applicant

  and as I pointed out to the applicant’s counsel the critical issue is that

  the parties agreed that the appointment happened as a result of another

  restructuring process.



[23] Another attack which was raised during argument against the

  agreement was that it contained a common error such that it could not

  be said that there was a meeting of the minds of the parties. The

  argument relates to the fact that whilst this was a termination based on

  operational reasons, it was in the signed agreement titled

  “resignation.” This argument has no merit. The approach to name the

  termination “resignation” arose from the concern by the applicant

  about the implication of securing future employment if it was to be

  stated that he was retrenched. He requested that the agreement should

  record the termination of his employment with the respondent as being

  due to resignation. This proposal was acceptable to the respondent

  and accordingly the reason for termination was titled as such in the

  agreement which was signed on the by both parties on 27 February

  2007.




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[24] Prior to signing the agreement and on 22 February 2006, the

   applicant confirmed the agreement that the termination will be treated

   as a resignation rather than termination based on operational reasons.

   The memorandum reads as follows:

             “BEDANKENG

             Beste Johan,

             Hiermee gee ek formeeel kennis date ek my dienste as

             Hoofbestuurder: Pakmateriaal sal be-eindig met effek 31

             Maart 2006.

Ek maak graag van hierdie geleentheid gebreuk om my uit te spreek
       teenoor die Direksie en Bestuur van Kaap Agri (Edms) Bpk vir die
       voorreg om deel van ‘n wonderlike span te gewees het.
             Voorspoed vir toekoms

Vriendelike groete.”
[25]   As stated above the agreement was signed by both parties on 27

   February 2006. In its introduction the agreement provides as follows:

                  “ANNGESIEN Kaap Agri met Du Plessis begin

                 konsulteer het oor sy moontlike diensbeeindiging weens

                 operassionele redes;

EN AANGESIEN Du Plessis op 22 February 2006 skriftelike kennis
       gegee het dat hy met effek van 31 Maart 2008 uit die diens van
       Kaap Agri bedank.”
        Clause 7 of the provides that the agreement is in full and final



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        settlement of any claim that the applicant may have against the

        respondent.



[26]    In the light of the above I do not agree that there was a confusion

   as to what was agreed upon by the parties. In any event the use of the

   word resignation is not significant in my view as what is significant is

   that the facts indicate clearly that the employment relationship was

   terminated by agreement.




_______________
      MOLAHLEHI J

       DATE OF HEARING        : 24 JUNE 2006
DATE OF JUDGMENT         : 12 JUNE 2008


       APPEARANCE

       For the Applicant :Adv Grobelar
       Instructed by     : J Gruss Attoneys

       For the Respondent: Attorney H Nieuwoudt
       Instructed by     : Deneys Reitz Inc




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